Google goes head to head with iTunes

By Bill SiwickiEditor, Mobile

Google Music enables consumers to buy songs and store them in the cloud.

Google Inc. took on Apple Inc. when it launched the Android mobile operating system to compete with Apple’s iPhone. Google surpassed Apple and now is the smartphone OS king, at least in market share by units sold. Now it’s hoping to do to digital music what it did with mobile phones, taking on Apple’s iTunes, which rules digital music, with a new service it has dubbed Google Music.

Consumers can access Google Music via the Android Marketplace and through a soon-to-be-released Android app. There they can peruse artists and songs, listen to 90-second samples, and purchase music, which is then stored in a personal account in Google’s cloud. A cloud is a vast collection of web servers hosted by a company that takes responsibility for securing the stored data. Users can access accounts on Google’s cloud through a user name and password over an encrypted Internet connection. Consumers with Android devices can access Google Music but cannot access iTunes.

Google Music customers are allowed to store up to 20,000 songs in the cloud, including songs they buy from Google and songs they upload from CDs. Because music is stored in the cloud and not on a device the consumer owns, users can access their music from any desktop, laptop, tablet or smartphone with an Internet connection. Apple earlier this year debuted iCloud, a service that enables iTunes users to store their music in the cloud and access it from many devices.

At the same time Amazon.com Inc., No. 1 in the Internet Retailer Top 500 Guide, is promoting the use of its Cloud Drive and Cloud Player tools, which it introduced this spring. The e-retailer’s Cloud Drive lets Amazon customers store up to five gigabytes, or more than 80 hours, of their own MP3 digital music files in their Cloud Drive accounts for free. Consumers also can use their Cloud Drive accounts to store photos, videos or documents; storage for digital content purchased from Amazon is unlimited. Customers can then use the Amazon Cloud Player to download and listen to music stored in their Cloud Drive accounts on any computer or Android-powered mobile device.

Apple, through iTunes, controls about 70% of the digital music market, according to investment firm Lazard Capital Markets. Apple Inc. is No. 3 in the Internet Retailer Top 500 Guide.

Google is aggressively pushing the cloud as the one and only path forward in digital music.

“Google Music helps you spend more time listening to your collection and less time managing it,” writes Andy Rubin, senior vice president, mobile, in a new Google blog post. “We automatically sync your entire music library—both purchases and uploads—across all your devices so you don’t have to worry about cables, file transfers or running out of storage space. We’ll keep your playlists intact, too, so your ‘Chill’ playlist is always your ‘Chill’ playlist, whether you’re on your laptop, tablet or phone.”

The Google Music store offers more than 13 million tracks from artists on Universal Music Group, Sony Music Entertainment and EMI—giving Google deals with three of the four major music labels, with Warner Music Group the holdout—as well as Merlin and over 1,000 independent labels including Merge Records, Warp Records, Matador Records, XL Recordings and Naxos. To launch the service, Google Music is offering numerous free and exclusive songs from such artists as the Rolling Stones, Coldplay, Busta Rhymes, Shakira, Pearl Jam and the Dave Matthews Band. Google and Apple charge between 69 cents and $1.29 for individual songs.

Last night, T-Mobile USA Inc. and Google celebrated the unveiling of Google Music with an event that featured live performances by Maroon 5, Busta Rhymes and Drake. To celebrate the launch of Google Music, T-Mobile is offering millions of T-Mobile customers using Android 2.2 or above smartphones and tablets free Google Music content from artists including Drake, Maroon 5, Shakira and others.

A question looms large over all the celebration, though. Can Google bust Apple’s iron grip on digital music and overtake iTunes in users and sales? If anyone can, Google can, especially as more consumers are buying Android smartphones, says Josh Crandall, CEO of Netpop Research LLC, an Internet and mobile consumer research firm.

“While Google Music will be a competitor to iTunes, it will take years to surpass Apple’s dominant position,” he predicts. “Consumers will convert over time as they upgrade their devices. It’ll take a couple of generations of mobile hardware.”